(Reuters) -A federal appeals court blocked U.S. President Donald Trump from removing Democratic members from two federal labor boards on Monday, setting aside its earlier ruling.
The decision by the U.S. Court of Appeals for the District of Columbia Circuit further complicates a pair of cases that are emerging as key tests of Trump’s efforts to bring federal agencies meant to be independent from the White House under his control.
The full D.C. Circuit in a 7-4 decision set aside a three-judge panel’s March ruling that paused lower court decisions blocking Trump from removing Gwynne Wilcox from the National Labor Relations Board and Cathy Harris from the Merit Systems Protection Board.
Monday’s decision puts back in place two judges’ decisions that upheld federal laws barring the president from removing members of the labor boards at will.
White House spokesman Harrison Fields argued the U.S. Constitution gives Trump the power to remove officials “who exercise his executive authority.”
“The Trump Administration plans to immediately appeal the decision, and looks forward to ultimate victory on the issue,” he said.
The cases will likely end up at the U.S. Supreme Court, which could use them to revisit a 90-year-old ruling that upheld restrictions on the president removing officials from multi-member agencies. That would have major implications for a number of agencies like the Federal Reserve and the Federal Trade Commission whose members are appointed by the president but have for decades acted independently of the White House.
Along with a lawsuit over Trump’s firing of two Federal Trade Commission members, the case is being eyed closely by Federal Reserve watchers for any indication that it could open the door for Trump to intervene in the Federal Reserve over political or policy disagreements, which would significantly undercut its independence.
Harris in a statement provided by her lawyer said that until Trump, presidents had for decades respected the removal protections that Congress adopted for members of the labor boards.
“Today the Court restores the constitutional equilibrium,” she said.
Deepak Gupta, a lawyer for Wilcox, said the ruling allows the NLRB to continue protecting the rights of workers.
“The Court’s decision today reaffirms 90 years of Supreme Court precedent that protects the independence of agencies like the NLRB and the Federal Reserve Board,” he said.
NEGLECT OR MALFEASANCE
The NLRB hears cases in which private-sector employers and labor unions are accused of illegal labor practices.
The merit board hears appeals by federal employees when they are fired or otherwise disciplined, and has been inundated with new cases as a result of Trump’s ongoing purge of the federal workforce.
Without Wilcox and Harris, the five-member NLRB and three-member Merit Systems Protection Board would not have enough members to decide cases, bringing much of the work of the agencies to a standstill.
More than 8,400 appeals have been filed with the board since Trump returned to office in January, which is roughly the number the agency typically receives in two years.
Like several other agencies, both boards were set up by Congress to be independent from the president in order to maintain impartiality when they decide individual cases. Congress passed laws giving job protections to members of these boards, allowing them to be fired by a president only for “neglect of duty or malfeasance in office” and, in the case of the merit board, also for inefficiency.
Trump fired Wilcox and Harris soon after he took office in January, the first time a president had acted to remove members of either board. Harris and Wilcox filed lawsuits separately accusing Trump of violating the statutory job protections in firing them.
The Trump administration acknowledged violating the laws, but said the protections from removal for members of the two boards ran afoul of the powers given to the president under the Constitution.
The D.C. Circuit panel split 2-1 when it paused the lower court rulings last month. Two Republican-appointed judges said removal protections for NLRB and merit board members were likely an invalid encroachment on Trump’s powers to manage the executive branch.
But the full court on Monday said those judges had ignored U.S. Supreme Court rulings from 1935 and 1958 that upheld protections from removal for members of the Federal Trade Commission and a World War Two-era war commission.
The Supreme Court in those rulings said such protections were valid for officials who primarily hear and decide individual cases rather than make new policies or otherwise wield significant executive powers.
The seven D.C. Circuit judges who voted to block Trump from firing Wilcox and Harris were appointed by Democratic presidents. The four judges who dissented are all Republican appointees.
(Reporting by Jonathan Stempel and Dan Burns in New York and Daniel Wiessner in Albany, New York; Editing by Chizu Nomiyama, Joe Bavier, Andrea Ricci, Alexia Garamfalvi and Aurora Ellis)
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